Stockmarket down, real estate up?

I was speaking to a real estate agent yesterday who said that real estate is about to boom again, in part as a result of the dramatic stockmarket crashes. Investors who had been in the stockmarket due to the decline in property prices may shift in large numbers over to property, with the attraction of increasing rental returns on offer. With more investors clamouring for a piece of the real estate action, combined with the ever increasing numbers of first home buyers, the recipe is certainly there for a change in fortune for the real estate industry.

I’m not sure that Australia could handle another boom in property prices, although it is possible if it’s the investors who are pushing the prices up. What we may see is a lot of fast moving real estate stock, with prices remaining steady. At the moment some well-priced properties are going very, very quickly, with multiple contracts on the table. If we get another decent drop in interest rates, that may set off a wildfire. Stay tuned!